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According to a just-released report by the McKinsey Global Institute, between 90 and 95 million low-skilled workers, or 2.6% of the global workforce, could be permanently jobless by 2020.

At the same time, employers will increasingly seek medium- and high-skilled workers, meaning those who have completed secondary school and some vocational training, and workers with college or postgraduate degrees.

In advanced economies, says the report, demand for high-skilled labor is growing faster than supply, while demand for low-skilled labor is weakening. Says the report, “Income inequality is growing as lower-skill workers—including 75 million young people—experience unemployment, underemployment, and stagnating wages.”

The report predicts increased polarization between high- and low-skilled workers, and says, “in some advanced economies, less-skilled workers could very well grow up poorer than their parents.”

McKinsey projects the following by 2020:

- A worldwide shortage of 38-40 million workers with college or postgraduate degrees.

- A shortage of 45 million workers with a secondary education in developing countries.

- An oversupply of low-skilled workers, meaning those without any college education or secondary education. That will amount to a global worker surplus of 11%. (Worldwide, the unemployment rate is now at 6%, according to the International Labour Office.)

Further, the report notes that the population is aging in countries where workers tend to have better educations and more skills, like China, the U.S. and the U.K. The report predicts that that aging will mean that by 2020, some 360 million people will not be participating in the labor market, including 38 million people with college educations.

The McKinsey study calls on policy makers and businesses to double those getting college and postgraduate degrees, and to allow high-skilled workers to immigrate to countries where they are needed. It also advocates retraining for mid-career workers and more vocational training for young people who do not go to college.

In China, it says the lack of skilled workers could slow the country’s move into value-added industries and get in the way of productivity gains. In India, the trend could mean that millions of people are trapped working in subsistence agriculture or living in urban poverty.

For developing countries to combat these trends and long-term unemployment for tens of millions of people, the report says they need to double or triple the growth of high schools and vocational schools. They also need to dramatically increase investments in infrastructure and housing construction, to create jobs for low-skilled workers.